Billionaire investor in talks to fund a railway to export iron ore in Congo
Cameroon — Paul Obambi, a billionaire investor in the Congo Republic, is in talks with French lenders to fund a railway he’s building to export iron ore.
Obambi’s company Sapro is negotiating with "a consortium of banks" to finance the 450km track that will link the south-western town of Mayoko to a port at Pointe Noire, he said in a phone interview from Paris on Tuesday. Construction is expected to start next year and be completed by 2022, he said, without saying how much it would cost.
Sapro operates an iron-ore project at Mayoko, acquired from SA-based Exxaro Resources in 2016. Exxaro sold the enterprise after failing to secure port and rail agreements with the Congolese government, booking a R5.76bn writedown in the process.
Since buying Exxaro’s operations for $350m, Sapro has invested $550m in Mayoko, which produced 3-million tonnes of iron ore last year, Obambi said. Exports of the steel-making ingredient helped Sapro generate a $1.5m profit last year from output at Mayoko.
"We expect to reach 5-million tonnes at the end of this year," he said. Expansion plans at Mayoko are expected to raise production to as much as 150-million tonnes, with exports being shipped through Pointe Noire and a port at Owendo in neighbouring Gabon, Obambi said.
Boosting output to that amount would place Congo among the world’s top iron-ore producers. Australia, the world’s largest, mined 880-million tonnes in 2017, while fifth biggest producer Russia’s output was 100-million tonnes, according to estimates published by the US Geological Survey. In 2013, Exxaro expected to reach production of 10-million tonnes at Mayoko by 2019.
Sapro has operations in 11 countries in Africa, Europe and Asia, with interests in oil and mining, consumer goods and media, according to its website.